Dubai is fast emerging as the global capital of superlatives: constructing, at record speed, the world's tallest building, largest mall, biggest theme park, only seven-star hotel and most expensive square kilometer of real estate on the earth.

In just over a decade, the relatively tiny desert emirate has experienced more growth than most countries, stealing the show at the two-day 10th Arab Investment and Capital Markets Conference held here.

Dubai-based developers plastered Beirut's streets, showcasing colossal, unprecedented projects such as an indoor ski resort, a billion dollar tower, and a series of man-made islands that are visible from outer space - all this from a country that was founded only 33 years ago.

Beyond the jaw-dropping visuals, business savvy Dubai has in its short history lured Fortune 500 companies and internationally recognized brands like Microsoft, Cisco Systems, CNN, and Harvard Medical School to operate out of the government-sponsored Internet City, Media City, and Health Care City initiatives. Add this to world-class entertainment events and international golf, horse racing, speed boat, tennis and motor cross championships.

If anything, the story of Dubai is being paraded as a shining example of diversification: a modest oil-exporting member of the United Arab Emirates - which holds 10 percent of the world's reserves - that now earns more revenue from tourism and trade than it does from fossil fuels.

It is also hailed as a fast-track businessman's utopia, with a "zero bureaucracy" policy that leaves the Arab world's notoriously rigid commercial systems in the dust.

But investors admit that the world's most daring and spectacular projects also carry the gravest risks, especially in a region now pulsating with at least three major military conflicts (US airbases located in the UAE played a pivotal role in both American invasions on Iraq).

Yet, with tens of billions of dollars being poured into massive tourism, real estate and multimedia ventures, there is an unbounded, intangible current of optimism thriving on the desert coast.

In interviews with The Daily Star, the heads of some of Dubai's most influential corporations and investment entities - from theme park developers to high-tech industrialists - overwhelmingly attributed the emirate's rapid rise to one man. Sheikh Mohammed bin Rashid al-Maktoum, Dubai Crown Prince and UAE Defense Minister is seen by Emiratis as an almost omniscient visionary.

With trade and tourism now accounting for 38 percent of GDP, he touted Dubai's transformation from a resource-driven economy to one based on people - on bringing job opportunities to the region's skilled populace and bringing tourists to its economies.

TECOM's plan, he explains, is to curb the Middle East's epidemic levels of brain drain, by bringing some of the world's leading multinationals like IBM, Dell, Reuters and CNBC to the people of the region, rather than vice versa.

He says Arab-Americans dominate those Dubai operations, which in the case of Sun Microsystems, covers 92 countries from the Media City.

"What we are trying to do is bring these people back from the West. ... Lebanese, Egyptian, Jordanian, whatever ... they tend to become a magnet for other brains from the region to come join them."
The Arab world is not plagued by a dearth of investments in research and development. The problem, Bin Byat explains, "is that most countries have still not figured out how to keep their best talent."

Aside from lucrative tax incentives and ultramodern infrastructure, "it all boils down to leadership," he says. "You have to be open minded - open to international companies to come invest in your country and to let them also take a piece of the pie."

"This is simply his highness' vision," says Salem Bin Dasmal, CEO of Dubailand, a $5 billion amusement park metropolis seen as essential to the emirate's plans to welcome 15 million tourists by 2010.

Pitched as the largest theme park in the world, the multi-billion square meter project encompasses 45 separate "worlds" from water and theme parks to tropical bio-domes: "His highness succinctly said that he wanted an Orlando-Las Vegas of the Middle East."

Two billion dollars in private capital has already been secured for the initial stage of Dubailand which according to Dasmal, will soon be opened to a range of investment options. "We should have a critical mass of projects by the end of 2007 and then see some maturity by 2015 to 2018."

Like most of the emirate's mega-projects, Dubailand is counting on its strategic location between Europe and the Far East, covering the Arab world, Central Asia and the Indian subcontinent: a combined population of 1.5 billion and GDP of $1.1 trillion.

The government has earmarked $100 million of $800 million that it will devote for public works, Dasmal explained, also lauding the $15 billion expansion of Emirates airlines and $5 expansion of Dubai International Airport.

"When private sector sees the government leading the way, it will follow. And when it sees the government putting its money where its mouth is ... than that in turn supports the projects," he says.

By cutting down on red tape, reducing customs barriers and making it easy to do business, "Dubai positioned itself decades ago to be a player with in the region," says Obaid Tayer, president of the Dubai chamber of commerce.

It takes only two days to set up a company in Dubai, but it could take up to two years to start doing business in other Arab states, he says.

"Other Arab governments ... make it so difficult because they think that you are going to take a part of their business or economy."

He reflected on Dubai's early start as a small harbor. In the early 1960s, when Dubai was hardly recognized in the region, "the first pioneers were Arab businessman from Lebanon."

Today, as the tables seem to have turned, Tayer expresses hope for the resolution of Lebanon's complex bureaucracy and "unfortunate political situation." Arab countries, he said "cannot be hooked to the past. This is business. This is evolving day in and day out. Either you want to be part of it or out of the game," he says.